Series S/X sales are pretty bad even with the S, and I don't think it's the S that's the issue (for example, I don't think Xbox has missed all that many games due to the S). In fact, the situation would probably be even worse without the S, so I'd say not having a completely dead platform can be largely attributed to the S. Is it good financially for Microsoft, all things considered? I'm not sure, but I think in hindsight it seems like the S was a good idea.

All digital console sucks shit and is useless. Holds series X back. It was just Phils cheeky way to say look at our entry price. Like anything Phil does, it backfired when prices kept going up.

It was a brilliant idea.

1) Cheapest console whilst consoles have never been more expensive and have CONSTANTLY risen in price. $500 AUD makes it a cheaper console for Minecraft/Roblox/Fornite and other titles than even the Switch 2 ($650 AUD)
2) Low-power consumption, low-noise, compact, great for those who are space/power limited.
3) Best selling model out of the entire Xbox Series Lineup.
4) Added a low-barrier entry that has benefited other low-power, low-performing devices like the Switch 2, Steamdeck, Rog Ally, Lenovo Legion, MSI Claw and more.
5) less impacted by commodity supply constraints of RAM, NAND and Silicon wafers due to using less, cheaper and smaller chips.

Good backwards compatibility with Xbox One with extended backwards compatibility to Xbox 360 and an insignificant number of Original Xbox games.

Although, seems sales or manufacturing has imploded recently... Not even EB Games is carrying the Xbox Series X or S consoles for sale, brand new... Now.

It was a bad idea at the time, bearing in mind what people were expecting from a next gen system. But this generation ("so far" lol) is ultimately a PS4 on steroids + SSD speeds, and prices going up makes a cheaper/weaker option more viable.

Now no one's going to make fun of a "Series S style" PS6 from Sony, especially if it's a home console variant of their "PS6 Portable". Software technology just hasn't evolved at the same rate as hardware, and great looking games are costing a lot more for a relatively small perceptible benefit. Hence the entire industry is shifting towards supporting weaker systems including mobile phones sometimes.

Good idea... Just too late.

It could turn out to be great long term strategy, since all that XSS library would easily run on their future actual XBOX handheld (not this XBOX branded PC handheld they're releasing now).

From a marketing and logistics perspective, it was a good idea. From a developer standpoint, it was terrible, it lead to a great many headaches to make software work in its significantly weaker hardware. The tiny storage space did it no favors either - 512GB in a world where single titles can take 150GB or more is quite the odd choice, for manufacturer and gamer alike.  

On paper, I think the idea of cheaper entry level system wasn't an inherently bad one, though I do think it could have been executed better.

I kinda wish for instance that there was a Series S variant with a disc drive. A little more RAM also probably would've been a good idea, as that seems to be the main pain point for developers.

I feel like circumstances also didn't really favour it; had Xbox Series as a platform been more popular, devs may have tailored their games more to the S, but as things stand with PS5 selling far more, Series S versions were a lower priority, leading to a lot of subpar versions.

I think it's a great idea and will probably be an inspiration for future generation of consoles offering a cheaper, less powerful console for those who don't want to spend $500+. Some people seem to blame the Series S for games that cannot run that well on it. This generation has shown me it's not the hardware (PS5 / Switch 2 / Xbox Series) that are the issue with modern games, it's the development. Time and time again we've seen game launch unoptimized regardless of hardware, and yet months if not years of updates the games run a lot better. What we need is for better game optimization, not more powerful hardware, because having more powerful hardware doesn't solve the core issue, development.

I agree with basically none of this.

1) If the Series X was the only option, their market share would likely be smaller.

2) Series S ultimately plays the same games at PS5 and Series X. For much of the market, that's fine. Many PC gamers aren't using specs at par with PS5 either. Much of the most popular games actually work really well on Series S and low end PCs.

3) Xbox evidently has big a enough userbase to justify many ports. I also assume the hardware itself makes ports easy. The platforms that lost support quickly generally sold less than 15 million units (Vita and Wii U are good examples).

4) I agree there is extra work to make a game play well on Series S. But a lot of these games are designed to work on even less powers PCs, portable PCs, etc. So lets not exaggerate how much work it actually requires. Developers have put much more effort getting games to work on Switch.

5) The only way MS could have made their market share grow is by having more/better exclusives AND selling all their hardware at a lower price. But they didn't really do either. So I guess they are content with their current profits.